Sick of paying off someone else’s mortgage? If you want a place of your own, it may seem like this dream is out of reach with property prices continuing to rise in many parts of the country. However, it’s completely possible to get yourself on the property ladder with a little hard work and commitment.
Here are some top tips to help you purchase that first property:
Know how much you can afford
Before you even begin looking at properties to rent, it’s crucial that you have a good idea of how much you can afford to pay. This will prevent heartache if you’re browsing properties and find the “perfect” property that’s out of your budget.
The idea is to keep your housing payment as less than 30% of your gross monthly income. Otherwise, you could end up living in a great home, but find it difficult to cover expenses or save.
Get financially prepared
One thing you’ll need to do early on? Check your credit score. You’ll want to make sure there are no errors in your score and potentially spend a few months paying for a monitoring service. One good way you can improve your score is to make sure you’ve paid down the balances of your credit cards (keep them open) for a few months before you apply for your mortgage. And avoid applying for any credit like a car loan or credit card until after you’ve already purchased your property.
Consider a condo
A condo can be a great option, since you’ll typically have fewer maintenance costs and if you choose not to stay in the property, they’re easy to rent out. Whether you’re looking for a Santa Monica condo for sale or you’d just like to browse LA condos for sale, be sure to do your research and due diligence before you sign on the dotted line. Condos can be a great first step if you’re not quite ready to buy a property out in the suburbs.
Your down payment will be anywhere from 3.5% to 20% of the purchase price of your home. You’ll also need more cash than you might think when it comes to closing costs. The more you can save as a downpayment, the less you’ll pay in interest, and the lower your monthly mortgage payments will be.